“Under a new rule proposed by the Equal Employment Opportunity Commission, all companies with more than 100 employees would be required to submit summary pay data each year. Since 1966, large companies have reported to the EEOC the number of their employees by sex, race, ethnicity and job group. The new proposal would add to that list pay data in 12 salary ranges, [with individual salaries] grouped together to protect privacy.” [USA Today, EEOC press release] “The data will be used to identify employers that may be engaging in pay discrimination so that the agency can target its enforcement resources where problems may be likeliest to exist. The proposal would cover more than 63 million U.S. workers, according to the White House. The plan… won’t require legislative approval.” [WSJ]
Aside from driving a high volume of litigation by the EEOC itself, the scheme will also greatly benefit private lawyers who sue employers, including class action lawyers. An employer might then weather the resulting litigation siege by showing that its numbers were good enough, or not. Would today’s Labor Department and EEOC policies look much different if the Obama administration frankly acknowledged that it was devising them with an eye toward maximum liability and payouts?
7 Comments
Why is this not 5th amendment violation? And is it illegal to use IRS data for this?
I’m wondering the same thing.
Mark – I was just going to sarcastically say this – add a few more boxes on the W-2, put the information there and send a second copy to the EEOC. Problem solved!
What part of the 5th amendment? Since the EEOC does not prosecute crimes, are you suggesting this is a taking?
I don’t see anything unconstitutional. I do have some concerns about the policy and the burden on businesses, though.
Allan,
From the EEOC press release:
This pay data would allow EEOC to compile and publish aggregated data that will help employers in conducting their own analysis of their pay practices to facilitate voluntary compliance. The agencies would use this pay data to assess complaints of discrimination, focus agency investigations, and identify existing pay disparities that may warrant further examination.
It is pretty difficult to say that the government is not forcing self incrimination here.
Using a duck test argument the EEOC enforcement actions are a criminal prosecution and thus this reporting requirement can be argued to be a self incrimination 5th amendment violation.
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